Other firms are related to the food and agriculture industries as suppliers. These firms produce and sell a broad range of items including tools and equipment, trucks, and shelving. In addition, supplier firms provide a broad range of services, including personnel, financial, advertising, consulting, and transportation services. Finally, a number of people are employed in government enterprises responsible for the regulation of the food and agriculture industries. The industry is responsible for 12.17 million supplier jobs. These firms generate about $3.27 trillion in economic activity.2
An economic analysis of the industry will also take additional linkages into account. While it is inappropriate to claim that suppliers to the industry’s supplier firms are part of the industry being analyzed,3 the spending by employees of the industry, and that of indirect firms whose jobs are directly dependent on the food and agriculture industries, should be included. This spending — on everything from housing, to food, to education and medical care — makes up what is traditionally called the “induced impact,” or multiplier effect, of the food and agriculture industries. For 2026, the induced impact of the industry generates 12.26 million jobs and $2.82 trillion in economic impact, for a multiplier of 0.65.4
An important part of an impact analysis is the calculation of the contribution of the industry to the public finances of the country. In the case of the food and agriculture industries, the direct taxes paid by firms and their employees provide $788.23 billion to the federal government and $558.66 billion to state and local governments.These figures do not include state and local sales and excise taxes that might be incurred by consumers.
Table 1 presents a summary of the total economic impact of the food and agriculture industries in the United States. Summary tables for the U.S., individual states and congressional districts are included on the website at FeedingTheEconomy.com.
Model Description and Data
The economic impact study begins with the IMPLAN model of the U.S. economy. Food-related IMPLAN industries are identified, and a matrix of state-by-state employment in the food industries is constructed. Since the most recent IMPLAN model is based on 2024 employment and output data, the growth rate in these industries through the middle of 2025 is applied. The growth trends are based on monthly jobs data by North American Industry Classification System (NAICS) sector, as recorded by the Bureau of Labor Statistics’ Quarterly Census of Employment and Wages.5 Combining the original industry job with the growth in employment in the industry, jobs are estimated as of the middle of 2025. A percentage break is applied to any IMPLAN industry that has significant business outside the scope of the food industry in order to isolate that portion of business related to food. Product breaks are based on the 2022 Economic Census of Retail Trade and the 2022 Economic Census of Wholesale Trade (the most recent data available).6 The intuition being, if 10% of a commercial equipment wholesaler’s business is moving and storing food-related products, then 10% of the commercial equipment wholesale jobs in that state should be considered food industry jobs. The job estimates are then run through the IMPLAN Input-Output model to estimate wages, output, and business taxes, as well as the supplier and induced impacts.
Table 2 summarizes the industries included in the study. The first two columns are the IMPLAN code and industry for those identified as food-related. The third column identifies which category corresponds with the particular industry. These are the categories presented on the data tables. The final column identifies which industries have a percentage applied to reflect only the food-related share of business. For those marked ‘no,’ all jobs are assumed to be food-related; For those marked ‘yes,’ the industry does business outside the scope of the food industry and a percentage break is applied.
IMPLAN Methodology7
Francoise Quesnay, one of the fathers of modern economics, first developed the analytical concept of inter-industry relationships in 1758. The concept was actualized into input-output analysis by Wassily Leontief during the Second World War, an accomplishment for which he received the 1973 Nobel Prize in Economics.
Input-Output analysis is an econometric technique used to examine the relationships within an economy. It captures all monetary market transactions for consumption in a given period and for a specific geography. The IMPLAN model uses data from many different sources – as published government data series, unpublished data, sets of relationships, ratios, or as estimates. The IMPLAN Group, LLC gathers this data, converts it into a consistent format, and estimates the missing components.
There are three different levels of data generally available in the United States: federal, state and county. Most of the detailed data are available at the county level, but there are many issues with disclosure – especially in the case of smaller industries. IMPLAN overcomes these disclosure problems by combining a large number of datasets and by estimating those variables that are not found from any of them. The data is then converted into national input-output matrices (Use, Make, By-products, Absorption and Market Shares) as well as national tables for deflators, regional purchase coefficients and margins.
The IMPLAN Make matrix represents the production of commodities by industry. The Bureau of Economic Analysis (BEA) Benchmark I/O Study of the US Make Table forms the bases of the IMPLAN model. The Benchmark Make Table is updated to current year prices and rearranged into the IMPLAN sector format. The IMPLAN Use matrix is based on estimates of final demand, value-added by sector and total industry and commodity output data as provided by government statistics or estimated by IMPLAN. The BEA Benchmark Use Table is then bridged to the IMPLAN sectors. Once the re-sectoring is complete, the Use Tables can be updated based on the other data and model calculations of interstate and international trade.
In the IMPLAN model, as with any input-output framework, all expenditures are in terms of producer prices. This allocates all expenditures to the industries that produce goods and services. As a result, all data not received in producer prices is converted using margins which are derived from the BEA Input-Output model. Margins represent the difference between producer and consumer prices. As such, the margins for any good add to one.
Deflators, which account for relative price changes during different time periods, are derived from the Bureau of Labor Statistics (BLS) Growth Model. The 224 sector BLS model is mapped to the 528 sectors of the IMPLAN model. Where data are missing, deflators from BEA’s Survey of Current Businesses are used.
Finally, the Regional Purchase Coefficients (RPCs) – essential to the IMPLAN model – must be derived. IMPLAN is derived from a national model, which represents the “average” condition for a particular industry. Since national production functions do not necessarily represent particular regional differences, adjustments need to be made. Regional trade flows are estimated based on the Multi-Regional Input-Output Accounts, a cross-sectional database with consistent cross interstate trade flows developed in 1977. These data are updated and bridged to the 528 sector IMPLAN model.
Once the databases and matrices are created, they go through an extensive validation process. IMPLAN builds separate state and county models and evaluates them, checking to ensure that no ratios are outside of recognized bounds. The final datasets and matrices are not released before extensive testing takes place.
About John Dunham & Associates
John Dunham & Associates (JDA) is a leading economic consulting firm specializing in the economics of fast-moving issues. JDA is an expert at translating complex economic concepts into clear, easily understandable messages for a wide range of audiences. JDA’s clients have included a wide variety of businesses and organizations, including some of the largest Fortune 500 companies in America.
John Dunham is a professional economist with nearly 40 years of experience. He holds a Master of Arts degree in Economics from the New School for Social Research as well as a Master of Business Administration from Columbia University. He also has a professional certificate in Logistics from New York University. Mr. Dunham has worked as a manager and an analyst in both the public and private sectors. He has experience in conducting cost-benefit modeling, industry analysis, transportation analysis, economic research, and tax and fiscal analysis. As a senior economist for Philip Morris, he developed tax analysis programs, increased cost-center productivity, and created economic research operations. He has presented testimony on economic and technical issues in federal court and before federal and state agencies.
Prior to Phillip Morris John was an economist with the Port Authority of New York and New Jersey, the Philadelphia Regional Port Authority, and the City of New York’s Department of Ports & Trade.
